TAKING STOCK : George, capitalism and the environment

Rakesh Wadhwa


George Fowler, disagreed with my March 21, article, ‘The crackpot Environmentalists’. His letter published in THT of March 31, showed yet again what the problem with environment extremists is: they refuse to consider any evidence which is contrary to their pre-conceived notions. Fowler says, “Companies such as Nike and Ford leave town to exploit the cheap labour sources and lax environmental regulations of other countries”. If Nike and Ford were to come to Nepal, do you think they can hire us at cheaper than the prevailing rate? Do you think they will pollute the environment any more than what we are already doing to it?

The answer is a resounding no to both these charges. The record of MNCs has been scrutinised over and over again. Wherever MNCs have gone they have reduced unemployment, raised the wages of workers, and provided a superior work environment than had existed before. Besides this MNCs generally bring in better and cleaner technology. Their access to superior managerial talent and financial muscle has been used to improve skills and enhance productivity of the host country.

Again leaving aside the evidence and statistics, let us go by logic alone. No company be it the mighty Microsoft, Nike, or Ford has the power to compel us to work for them, buy their products, or become their suppliers. They have to, in each case, depend on our voluntary cooperation. The power to institute force is the exclusive preserve of the government. Only it can ask us to part with our money without our consent. Taxes are just that — exactations without consent. We willingly buy Nike shoes and Ford cars, but we have no such choice when it comes to government payments. Fowler, if Nike and Ford chose to come to Nepal, they should be accorded a red carpet welcome. You will see queues of Nepalis applying for jobs. Nepal will gain. Immensely so.

Fowler says, “There is the famous example of Erie Canal catching fire due to excess toxins discharged directly by competing companies into it.” To this, let me add another egregious example of pollution caused by a private company: the oil spill from Exxon’s super tanker Valdez off the north-west coast of America which polluted the ocean for miles around. All that these examples do is to support property rights and capitalism. They do not show as Fowler says “capitalism will continue to provide the best product at the cheapest price and consume and degrade everything in its path”. Why are rivers, canals, and oceans polluted? Why have they become dumping grounds for our waste and poisons? Why is the Bagmati such an eyesore?

Do we allow waste to be dumped in our houses? Would Hyatt allow its property to become a dumping ground for industrial waste? But rivers and oceans which are controlled by governments, or, in other words, by none of us, become dumping grounds. In the UK where streams can be and are privately owned, the fish frolic in unpolluted waters. Any property which is common to us, belongs, in reality, to none of us and will bear the full brunt of degradation — this is the ‘tragedy of the commons’. Property rights are an essential feature of capitalism. It is the absence of property rights which causes, a catastrophe. The pollution, the environmental degradation, and the devastation of waterways in Soviet Russia and in China under communism has no parallel in history.

Further, since the state caused the pollution and controlled all the media, it was only in recent years that we are coming to realize the environmental horror unleashed by communism in these countries. Contrast this with the Exxon’s Valdez’s oil spill. The story made news for months around the world. Exxon was pilloried and hauled to court. It was held liable for the fault of its drunk commander and was made to clean up every last bit of the oil it spilled. It also ended up by paying billions of dollar in damages, besides spending a fortune in legal costs, and suffering from a greatly tarnished reputation. There is thus a huge incentive for big companies to be environmentally friendly. That is why the cities are greener, the water cleaner, and air purer than it ever was in the developed major cities like London and Los Angeles.(The writer can be contacted at: everest@mos.com.np)